India Lines Up $25 Billion Deep-Tech Push as Funding Gap With US Remains Wide

India is preparing a $25 billion pool of capital for deep-tech investments as the country looks to build more of its critical technology at home and reduce its dependence on overseas suppliers. 

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The push covers areas such as artificial intelligence, semiconductors, advanced manufacturing, drones and space technology sectors where developing a product can take years and require considerably more capital than conventional technology businesses. 

India has invested about $11.6 billion in deep tech over the past decade. The next phase could be much larger. The government has committed $11 billion through the Research Development Infrastructure Fund, with venture capital and private equity managers expected to match that amount. Another $3 billion to $4 billion could take the overall capital available for deep-tech investments to around $25 billion. 

The funding comes as India’s deep-tech ecosystem begins to produce larger companies. Earlier this year, vibe-coding startup Emergent, space-tech company Skyroot and sovereign AI developer Sarvam crossed valuations of $1 billion in their latest fundraising rounds. 

Interest from investors has also grown. A recent survey by the Indian Venture and Alternative Capital Association found that nine out of 10 funds in India are deploying money into deep-tech startups. 

Funding reached a record $3 billion in 2025, even as investment in India’s wider startup ecosystem slowed. 

The difference with the United States, however, remains substantial. Deep-tech startups in the US raised $136 billion during the same period, highlighting the scale of capital available to companies developing frontier technologies there. 

One of India’s biggest constraints is the availability of large pools of domestic risk capital. While early-stage companies and technical talent are present, deep-tech businesses often need much larger investments as they move from research and prototypes to commercial production. 

Only 2% of domestic investors can write cheques of more than $10 million, according to the report. That leaves companies requiring sizeable funding rounds with a relatively small pool of local investors. 

Geopolitical developments have added another reason for India to build domestic capabilities. The US and China remain dominant forces in artificial intelligence and other frontier technologies, while access to overseas technology can be affected by trade restrictions and export controls. 

A recent example came when Anthropic disabled access to its new Fable 5 and Mythos 5 models for foreign nationals to comply with US export-control directives. 

Against this backdrop, India’s planned $25 billion funding pool represents a much larger commitment to technologies that can take years to reach commercial scale. The capital gap with the world’s biggest deep-tech market remains wide, but the amount of money being directed towards the sector in India is set to rise substantially from levels seen over the past decade.